Conventional payment-on-deliver (POD) or collect-on delivery (COD) transactions involve at least a consumer, a merchant, and a third-party delivery service. In some instances, the merchant may be the delivery service, for example, such as frozen food home delivery services. Generally, the third-party delivery service collects payment for the purchased goods and/or services at the time and place of delivery on behalf of the merchant and keeps a portion of the proceeds as payment for making the delivery. COD transactions benefit the consumer, as the consumer is not required to pay for the goods and/or services until the goods and/or service are delivered.
COD transactions are labor intensive and require the third-party delivery service to manually collect and/or process the consumer's payment upon delivery. This is problematic, as the consumer may not be present at the time of delivery. In addition, the merchant has no assurance that the consumer will have the cash on hand or be approved by a respective financial institution to make the purchase at the time of delivery. This contributes to wasted expenditures associated with the packaging and shipping of goods, in addition to relying upon the completion of a manual transaction, which is inherently error-prone by requiring human input of, for example, the price of the goods.